Singapore narrows growth forecast after economy shrinks in 2Q

SINGAPORE’S economy slipped into contraction in the second quarter, signaling more challenges for the city-state already grappling with worsening price pressures.

Gross domestic product declined an annualized 0.2% in the quarter ended June from the previous three months, according to final estimates from the Ministry of Trade and Industry released Thursday. That was worse than the preliminary estimate that showed zero growth and compares with a forecast of 0.3% growth in a Bloomberg survey of economists.

That shrinkage prompted the ministry to narrow its projection for Singapore’s 2022 growth to a range of 3%-4% from 3%-5% previously, while flagging risks to global recovery from aggressive monetary policy tightening as well as China’s ongoing fight with Covid-19 and property market downturn

The trade-reliant city-state has sought to stave off further damage to its post-Covid growth recovery, stemming especially from supply snarls that have driven up prices, and forced the central bank to tighten last month in a surprise move.

Alongside a pledge to keep up targeted subsidies to aid the most vulnerable households, Singapore officials are bracing for further volatility in a global economy that the International Monetary Fund warned is on the brink of recession.

The trade ministry data Thursday also showed the economy grew 4.4% in the second quarter from a year ago, compared with an earlier estimate of 4.8% expansion. — Bloomberg

Further second-quarter GDP details, year-on-year, from the MTI include:
  • Manufacturing 5.7%, after 5.5% in the previous quarter
  • Construction 3.3%, after 2.4%